Placing to raise GBP8.6million

New World Oil and Gas Plc / Index: AIM / Epic: NEW / Sector: Oil & Gas

9 October 2012

New World Oil and Gas Plc ('New World' or 'the Company')

Placing to raise £8.6million

Exercise of Warrants

Total voting rights

New World Oil and Gas Plc, the oil and gas operating, exploration and development company focused on Belize and Denmark, has raised £8.6 million (approximately US$14 million) gross of expenses by the issue of 95,555,556 new ordinary shares (the 'Placing Shares') at a price of 9 pence per share (the 'Placing'). The proceeds of the Placing will be used to fund the drilling of a third well at the Company's Blue Creek Project ('Blue Creek' or the 'Project') located in the productive Petén Basin in Northwest Belize, the planned 3-D seismic programme on the Company's Danica Jutland project in Denmark and for general working capital purposes. The well is set to target Prospect A which RPS Energy has given P50 volumetrics of 124 million barrels of oil ('MMbo'), on a 100% working interest basis.

William Kelleher, Chairman and Chief Executive, said, "I am delighted with the interest and support New World has received from both new and existing shareholders, resulting in the Placing being oversubscribed. We are clearly not alone in believing New World is well placed to become a leading oil and gas company with a portfolio of projects at various stages of development. I view the Placing as a vote of confidence in the rapid progress we have made in not only acquiring three highly prospective projects in Belize and Denmark, but also in systematically identifying and derisking multiple prospects across our portfolio.

"We are now fully funded to complete our on-going, three well drilling programme in Belize and, in the process, acquire a 100% working interest in Blue Creek, which has current estimated gross P50 volumetrics of 329MMbo and a Net Present Value ('NPV10') of US$8.1billion. At the same time, we will continue our programme of seismic acquisition in Denmark with a view to commencing drilling in 2013. In Belize, drilling has commenced at our B Crest Prospect which our Competent Person has assigned a 1 in 5 chance of success and gross P50 un-risked prospective resources of 92.1 MMbo (Y1 and Y2 intervals). We have calculated the P50 un-risked NPV10 of US$2.4 billion. We will of course update the market on our progress at this exciting time for the Company, as and when it is appropriate to do so." 

Details of Placing

The Placing Shares will rank pari passu in all respects with the Company's existing ordinary shares and represent 27.1% of the Company's enlarged issued share capital following the Placing. Application has been made for the admission of the Placing Shares to be admitted to trading on AIM ('Admission'), and Admission is expected to occur, and dealings expected to commence at 08.00 on 16 October 2012.

Directors' Subscription

All of the directors have subscribed for new ordinary shares on the same terms as the Placing as outlined above, as follows:

** 4,591,744 Ordinary Shares will be held by Hydrocarbon Technologies Limited, which is wholly owned by the Danniella Noor Kelleher Trust. The interest is a non-beneficial interest.

*** 10,439,471 Ordinary Shares will be held by the Black Sea and Caspian Trust, in which both Georges Sztyk and Peter Sztyk have a beneficial interest as potential (but unnamed) beneficiaries and 833,333 Ordinary Shares are held by Peter Sztyk in his own name.

**** 9,606,138 Ordinary Shares will be held by the Black Sea and Caspian Trust in which both Georges Sztyk and Peter Sztyk have a beneficial interest as potential (but unnamed) beneficiaries.

The Company has agreed to lend £155,556 to Hydrocarbon Technologies Limited to fund its subscription. The loan is interest-free, unsecured and repayable on demand and shall automatically be repaid out of its (or William Kelleher's) 2012 bonus entitlements which are expected to exceed the amount of the loan.

Exercise of Warrants

Pursuant to the exercise of a total of 2,175,000 Warrants, the Company also announces today the issue of 2,175,000 new ordinary shares. Application has been made for these shares, which will rank pari passu, with all existing ordinary shares in the Company, to be admitted to trading on AIM, such admission expected to take place on 16 October 2012. 

Total Voting Rights

The Company has no Ordinary Shares held in treasury. The total number of voting rights in the Company following the Placing and the exercise of warrants will therefore be 354,274,007. This figure may therefore be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FSA's Disclosure and Transparency Rules.

The Company also notifies that it has been in negotiations with a potential overseas investor (the 'Potential Investor') regarding a possible strategic investment of cash (initially US$6 million) for new shares in the Company, although no agreement was reached or concluded. New World informed the Potential Investor that it was proceeding with the Placing, following which the Potential Investor alleged that the past negotiations had concluded. No agreement was concluded and therefore the Board of New World (having consulted with its legal advisers) believes that there is no basis on which the Potential Investor could make a successful claim against the Company.

** ENDS **

For further information please visit www.nwoilgas.com or contact:

Notes

New World Oil and Gas Plc is an oil and gas operating company with three highly prospective projects in Belize and Denmark. New World is operator of all three projects where a systematic programme of seismic acquisition has resulted in multiple prospects being identified and derisked, a number of which have been classified by the Competent Person as being drill ready. Blue Creek in Belize is the Company's most advanced project where drilling has commenced at B Crest, a prospect with un-risked P50 prospective resources of 92MMbo and a POSg of 1 in 5 as confirmed by a Competent Person. New World also operates two projects in onshore Denmark located in producing basins covering a combined area of over 2.6 million acres, making it the largest holder of acreage in Denmark.

Management is constantly evaluating additional projects that would complement the Company's growing portfolio, particularly late stage exploration or early production projects located in basins with large proven reserves that, in the opinion of the Directors, are undervalued, underdeveloped or under-performing. As a result, the Board is actively identifying exploitation opportunities in areas including Africa, South America and South East Asia as it looks to build a leading, diversified oil and gas company.